TEST BANK FOR CORPORATE FINANCE
22ND EDITION BY ROSS ALL CHAPTER
1 TO 27 2026 2027 VERIFIED ANSWERS
ACTUAL UPDATED PRACTICE
QUESTIONS HIGH YIELD STUDY GUIDE
CORPORATE FINANCE EXAM
PREPARATION GRADED A+ STUDENT
SUCCESS REVIEW
CorporatepFinance,p12ep(Ross)
Chapterp4ppDiscountedpCashpFlowpValuation
1) Thepnetppresentpvaluepofpapprojectpispequalptopthe:
A) presentpvaluepofpthepfuturepcashpflows.
B) presentpvaluepofpthepfuturepcashpflowspminuspthepinitialpcost.
C) futurepvaluepofpthepfuturepcashpflowspminuspthepinitialpcost.
D) futurepvaluepofpthepfuturepcashpflowspminusptheppresentpvaluepofpthepinitialpcost.
E) sumpofpthepproject'spanticipatedpcashpinflows.
Answer:p BpDifficult
y:p1pEasy
Section:p 4.1pValuation:pThepOnePeriodpCasepTopic:p
Netppresentpvalue
Bloom's:p UnderstandpAACSB
:p ReflectivepThinking
Accessibility:p KeyboardpNavigation
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,2) Whichponepofpthesepstatementspispcorrectpconcerningptheptimepvaluepofpmoney?
A) Increasingpthepinitialpcostpofpapprojectpincreasespthepproject'spNPV.
B) Increasingpthepdiscountprate,pincreasespthepPVpofpapproject.
C) IncreasingpthepFVpdecreasespthepPV.
D) DecreasingpthepPVpdecreasespthepFV.
E) DecreasingpthepdiscountpratepincreasespthepFV.
Answer:p DpDifficult
y:p1pEasy
Section:p 4.1pValuation:pThepOnePeriodpCasepTopic:p
Netppresentpvalue
Bloom's:p UnderstandpAACSB
:p ReflectivepThinking
Accessibility:p KeyboardpNavigation
,
3) Atpapdiscountpratepofp5ppercent,pwhichponepofpthepfollowingpispthepcorrectpformulapforpc
omputingpthepPVpofp$1ptopbepreceivedponepyearpfromptoday?
A) $1/1.05
B) $1
C) $1p×p1.05
D) $1p×p1.052
E) $1/1.052
Answer:p ApDifficult
y:p1pEasy
Section:p
4.1pValuation:pThepOnePeriodpCasepTopic:p
PresentpvalueppsinglepcashpflowpBloom's:p
Understand AACSB:p
ReflectivepThinkingpAccess
ibility:pKeyboardpNavigation
4)
Whatpeffectpwillpanpincreasepinpthepdiscountpratephaveponptheppresentpvaluepofpapprojectpthatphaspa
npinitialpcashpoutflowpfollowedpbypfivepyearspofpcashpinflows? A)
TherepwillpbepnopeffectponpthepPV.
B) ThepPVpwillpchangepbutpthepdirectionpofpthepchangepispunknown.
C) ThepPVpwillpremainpthepsamepasptheptimingpofpthepcashpflowspmustpchangepalso.
D) ThepPVpwillpincrease.
E) ThepPVpwillpdecrease.
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,Answer:p EpDifficulty
:p1pEasy
Section:p 4.2pThepMultiperiodpCase
Topic:p Presentpvaluep-
pmultiplepcashpflowspBloom's:p Understand AACSB:p
ReflectivepThinkingpAccess
ibility:pKeyboardpNavigation
, , , ,
, Stuvia.com - The Marketplace to Buy and Sell your Study Material
5) Youparepconsideringptwopprojects.pProjectpAphaspprojectedpcashpflowspofp$6,500,p$4,500,pand
$2,500pforpthepnextpthreepyears,prespectively.pProjectpBphaspprojectedpcashpflowspofp$2,500,
$4,500,pandp$6,500pforpthepnextpthreepyears,prespectively.pAssumingpbothpprojectsphavepthepsamepin
i tialpcost,pyoupknowpthat:
A) thereparepnopconditionspunderpwhichpthepprojectspcanphavepequalpvalues.
B) ProjectpBphaspaphigherpnetppresentpvaluepthanpProjectpA.
C) ProjectpApispmorepvaluablepthanpProjectpBpgivenpappositivepdiscountprate.
D) bothpprojectspofferpthepsamepratepofpreturn.
E) bothpprojectsphavepequalpnetppresentpvaluespatpanypdiscountprate.
Answer:p CpDifficult
y:p1pEasy
Section:p 4.2pThepMultiperiodpCase
Topic:p Presentpvaluep-
pmultiplepcashpflowspBloom's:p Understand AACSB:p
ReflectivepThinkingpAccess
ibility:pKeyboardpNavigation
6) Anpinterestpratepthatpispcompoundedpmonthly,pbutpispexpressedpaspifpthepratepwerepcompoundedpa
nnually,pispcalledpthep rate.
A) statedpinterest
B) compoundpinterest
C) effectivepannual
D) periodicpinterest
E) dailypinterest
Answer:p CpDifficult
y:p1pEasy
Section:p 4.3pCompoundingpPeriods
Topic:p Annual,pholdingpperiod,pandpeffectivepratespBloo
m's:p Remember
AACSB:p ReflectivepThinkingpAccess
ibility:pKeyboardpNavigation
,
, Want to earn $1.236 , ,
22ND EDITION BY ROSS ALL CHAPTER
1 TO 27 2026 2027 VERIFIED ANSWERS
ACTUAL UPDATED PRACTICE
QUESTIONS HIGH YIELD STUDY GUIDE
CORPORATE FINANCE EXAM
PREPARATION GRADED A+ STUDENT
SUCCESS REVIEW
CorporatepFinance,p12ep(Ross)
Chapterp4ppDiscountedpCashpFlowpValuation
1) Thepnetppresentpvaluepofpapprojectpispequalptopthe:
A) presentpvaluepofpthepfuturepcashpflows.
B) presentpvaluepofpthepfuturepcashpflowspminuspthepinitialpcost.
C) futurepvaluepofpthepfuturepcashpflowspminuspthepinitialpcost.
D) futurepvaluepofpthepfuturepcashpflowspminusptheppresentpvaluepofpthepinitialpcost.
E) sumpofpthepproject'spanticipatedpcashpinflows.
Answer:p BpDifficult
y:p1pEasy
Section:p 4.1pValuation:pThepOnePeriodpCasepTopic:p
Netppresentpvalue
Bloom's:p UnderstandpAACSB
:p ReflectivepThinking
Accessibility:p KeyboardpNavigation
, , , ,
,2) Whichponepofpthesepstatementspispcorrectpconcerningptheptimepvaluepofpmoney?
A) Increasingpthepinitialpcostpofpapprojectpincreasespthepproject'spNPV.
B) Increasingpthepdiscountprate,pincreasespthepPVpofpapproject.
C) IncreasingpthepFVpdecreasespthepPV.
D) DecreasingpthepPVpdecreasespthepFV.
E) DecreasingpthepdiscountpratepincreasespthepFV.
Answer:p DpDifficult
y:p1pEasy
Section:p 4.1pValuation:pThepOnePeriodpCasepTopic:p
Netppresentpvalue
Bloom's:p UnderstandpAACSB
:p ReflectivepThinking
Accessibility:p KeyboardpNavigation
,
3) Atpapdiscountpratepofp5ppercent,pwhichponepofpthepfollowingpispthepcorrectpformulapforpc
omputingpthepPVpofp$1ptopbepreceivedponepyearpfromptoday?
A) $1/1.05
B) $1
C) $1p×p1.05
D) $1p×p1.052
E) $1/1.052
Answer:p ApDifficult
y:p1pEasy
Section:p
4.1pValuation:pThepOnePeriodpCasepTopic:p
PresentpvalueppsinglepcashpflowpBloom's:p
Understand AACSB:p
ReflectivepThinkingpAccess
ibility:pKeyboardpNavigation
4)
Whatpeffectpwillpanpincreasepinpthepdiscountpratephaveponptheppresentpvaluepofpapprojectpthatphaspa
npinitialpcashpoutflowpfollowedpbypfivepyearspofpcashpinflows? A)
TherepwillpbepnopeffectponpthepPV.
B) ThepPVpwillpchangepbutpthepdirectionpofpthepchangepispunknown.
C) ThepPVpwillpremainpthepsamepasptheptimingpofpthepcashpflowspmustpchangepalso.
D) ThepPVpwillpincrease.
E) ThepPVpwillpdecrease.
, , , ,
,Answer:p EpDifficulty
:p1pEasy
Section:p 4.2pThepMultiperiodpCase
Topic:p Presentpvaluep-
pmultiplepcashpflowspBloom's:p Understand AACSB:p
ReflectivepThinkingpAccess
ibility:pKeyboardpNavigation
, , , ,
, Stuvia.com - The Marketplace to Buy and Sell your Study Material
5) Youparepconsideringptwopprojects.pProjectpAphaspprojectedpcashpflowspofp$6,500,p$4,500,pand
$2,500pforpthepnextpthreepyears,prespectively.pProjectpBphaspprojectedpcashpflowspofp$2,500,
$4,500,pandp$6,500pforpthepnextpthreepyears,prespectively.pAssumingpbothpprojectsphavepthepsamepin
i tialpcost,pyoupknowpthat:
A) thereparepnopconditionspunderpwhichpthepprojectspcanphavepequalpvalues.
B) ProjectpBphaspaphigherpnetppresentpvaluepthanpProjectpA.
C) ProjectpApispmorepvaluablepthanpProjectpBpgivenpappositivepdiscountprate.
D) bothpprojectspofferpthepsamepratepofpreturn.
E) bothpprojectsphavepequalpnetppresentpvaluespatpanypdiscountprate.
Answer:p CpDifficult
y:p1pEasy
Section:p 4.2pThepMultiperiodpCase
Topic:p Presentpvaluep-
pmultiplepcashpflowspBloom's:p Understand AACSB:p
ReflectivepThinkingpAccess
ibility:pKeyboardpNavigation
6) Anpinterestpratepthatpispcompoundedpmonthly,pbutpispexpressedpaspifpthepratepwerepcompoundedpa
nnually,pispcalledpthep rate.
A) statedpinterest
B) compoundpinterest
C) effectivepannual
D) periodicpinterest
E) dailypinterest
Answer:p CpDifficult
y:p1pEasy
Section:p 4.3pCompoundingpPeriods
Topic:p Annual,pholdingpperiod,pandpeffectivepratespBloo
m's:p Remember
AACSB:p ReflectivepThinkingpAccess
ibility:pKeyboardpNavigation
,
, Want to earn $1.236 , ,
